Section L-Theory_[40 points] . In financial accounting, we often refer to the "entity principle." What does this mean, and why is it of such importance? 2. What do accountants mean when they refer to "materiality? Provide a real-life example of where this theoretical principle is appropriately used, and find another where it was employed to abet fraud (If you struggle with this, think "Enron") What is meant by the "conservatism principle" of accounting? Discuss how this affects accountants' thinking, and give an example of where conservatism is applied on the balance sheet. sheet where the conservatism principle is routinely violated. Now, give an example on the balance What is the "going concern assumption" in accounting and what does its application allow financial accountants to do? Where on the balance sheet does the going concern principle "override" conservatism? What are closing entries," and how do they highlight the relationship between "permanent" and "temporary" accounts? 6. Based upon their legal structure, what are the three primary xample of forms of business entities? Give a real world e each. Which of these entities are flow-through," and what does this term mean? Finally, what account will only be found in one of these three types of entities? Why is this account of particular importance to accounting? 7. Write out the "accounting equation" and discuss its Provide a personal example of each of component elements. these elements. s. What is the "revenue recognition princ nue recognition principle" and how does it relate to "matching?" What is the name and significance of the financial accounting method based principle? upon the matching